The best time to buy Bitcoin isn’t anytime you feel like it. If you doubt the statement, you can ask anyone who bought bitcoin in late 2017, and patiently had to wait for three long years before they could break even.
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Aside from broader market conditions, many also wonder if there is a ‘best’ time of the day to buy bitcoin in the UK. Should it be in the morning, afternoon, or evening hours? Can one make more profit by buying bitcoin on certain days of the week?
We will answer those questions in this article, and also explain why the timing may not necessarily matter in the long run.
Why finding the best time to buy Bitcoin is essential?
There are two main reasons why knowing the best time to buy bitcoin is important.
For one thing, it means anyone buying bitcoin (stacking sats) for long-term holding can get more bitcoins for their money by placing their buy orders at the right time. Getting perhaps 2% extra than you usually would mean greater rewards in the future.
The second reason is that knowing the best time of the day or week to buy bitcoin prevents an investor from yielding to the fear of missing out (FOMO). Many buy bitcoin at high prices because they fear they could miss out on possible short-term gains.
On the other hand, finding the best time to buy and sticking to the schedule protects one from the losses usually associated with panic buys.
Now that we know the possible benefits associated with timing bitcoin buys let’s consider how one can make the most of the opportunity.
How to find the best time to buy Bitcoin
Day of the week
Statistical evidence shared by Capriole digital asset manager Charles Edwards supports the fact that the best day of the week to buy bitcoin is on Sunday evening.
The chart below shows that those who buy BTC during the said period see higher returns on their investment than purchases made during weekdays.
(Source: Charles Edwards)
A simple way to understand the chart is that the daily average bitcoin return on each weekday is best on a Monday after the investor buys his stack. The returns in the last eight years have usually been around 0.9%.
Some possible reasons to explain why Sunday evenings are the best time to buy BTC is that trading volumes on crypto exchanges usually drop during the weekend. There are few active traders in the market and more sell than buy orders.
The dip in buy orders and general trading volume means prices become more volatile at the start of the new week. While prices usually dip during the weekend, a reopening of many exchanges will drive volume back up, and usually push prices positively.
US derivatives giant, CME Group, which also contributes significantly to bitcoin’s global volume (over $500 million daily) traded by institutional investors, also goes on a break during the weekend.
Their Sunday reopening at 5:00 pm (CT) or 11:00 pm GMT (UK Time) increases the chances of a volatile opening at the start of a new week and a possible price increase for BTC.
So, although the bitcoin market trades 24/7 globally, reducing the number of active traders and volume at the weekend typically pushes the BTC price up, barring any negative mainstream news.
Buying your stack at the weekend (Sunday evenings precisely) gives you a shot at being a fraction up when the markets start to reopen for a new week.
Time of the Month
Retails investors constitute a significant percentage of bitcoin investors. For instance, buyers on Square’s cash app reportedly consume a substantial amount of bitcoins compared to daily network issuance.
A common practice among these armies of retail investors is to set up recurring buys that go off once they receive their paycheck towards the end of the month. Barring black-swan events such as the market crash caused by the COVID-19 pandemic, these buy typical cause the price of BTC to go up.
In simpler terms, buying bitcoin at these times means you’d usually buy it at a higher price. On the other hand, completing your purchases in the middle of the month or anytime before the month-end rush could allow you to get them for better prices.
The worst time and day for buying coins
The bitcoin markets’ dynamic nature makes it almost impossible to pinpoint the worse time and day for making purchases. However, going by the principle of “buying low and selling high,” one could find the worst time and day for a particular period in a week, day, or month.
The above chart considers the period between Nov 30 to Dec 7. A close observation shows a patterned bitcoin dip approaching midday at 12:00 UTC several days in the same week. That could suggest that midday purchases within the coming period provide a chance to buy BTC cheaper.
The pattern repeats the following week from Dec 8 to Dec 16, barring a different price action on 15th December when prices spiked around noon.
Although the above charts do not provide a definite pattern for determining the best time of the day to buy bitcoin, it shows how one could time their purchases based on consistent price action for a specified period.
Conclusively, the worst day to buy BTC is any day when prices are in an uptrend. Such rapid price growth is only short-term gains and climax with a period of consistent losses. Making it a principle to buy BTC only on days when it is down a certain percentage (%6+) is a better way to get more sats for your money.
What impacts the best time to buy BTC?
Several factors include bitcoin’s market price, and thus the best time to make new purchases. Here are some of the most prevalent
Markets are irrational. Price swings may occur for no tangible reasons and change the market sentiment and outlook from bullish to bearish within a short time. Then almost everyone will literally be burning their money by selling at a low price.
That is when being a disciplined investor becomes your greatest asset.
Using the “buy low, sell high” principle mentioned earlier, it is easy to see that the best time to buy BTC is when the market is bearish, and coins are available at discount prices. A good example was the crypto bear market that pushed BTC near $3200, and the 2020 March crash that saw BTC slump to a little above $4000.
While one cannot accurately predict when or whether we’ll see another Bitcoin black-swan event, keeping cash handy to invest at such times could turn out to be the best bitcoin purchase you’ve ever made.
Media reports are another factor that adversely affects the price of BTC. Events such as a major exchange hack, the possibility of a Bitcoin ETF, and large institutional investments affect price either way.
Capitalising on adverse media reports that suppress the price of Bitcoin may be another approach to scooping up coins at great prices.
Key industry events such as the Bitcoin halving historically push the price of BTC up in the months leading up to it and then eventually drops in the aftermath.
The chart below shows the BTC price wave from April to the May 2020 halving event. Prices moved from around $6300 to just below $10,000 in the build-up to the halving, while a significant price dip occurred on May 12th, the actual halving date.
The effect of the Bitcoin halving that reduces the cryptocurrency’s supply is usually felt in the long-term. However, buying in the months leading up to it allows investors to price in on the event reap quick short-term gains.
Should I buy Bitcoin now?
The best time to buy bitcoin was years ago. The second best time is right now. Bitcoin was the best performing asset of the last decade and had inherent properties that almost guarantees a price increase in the years ahead.
Many notable investors including Robert Kiyosaki, Paul Tudor Jones, Stanley Druckenmiller, and Mexican billionaire Ricardo Salinas Pliego, recommend at least 1% exposure to bitcoin and tip the cryptocurrency to become the ‘digital version of gold eventually.’
If Bitcoin were to achieve half of what its proponents believe, it could overcome its current volatile nature and reach numbers beyond the current $440 billion market cap.
Knowing the best time to buy bitcoin is beneficial and healthy for the portfolio of every investor. In this article, we reviewed different times to buy bitcoin at lower prices and revealed the factors that adversely move the market to create great buy opportunities.
Time and again, bitcoin has defied odds to bring in great results for investors. Only time will reveal whether the asset finally lives up to its potential to become ‘digital gold’ and redistribute wealth to those who buy into the vision now.